IMA-08401 (C2) is a novel aryl hydrocarbon receptor (AHR) agonist and selective AHR modulator (SAHRM) that is structurally similar to laquinimod (LAQ). Both compounds are converted to the AHR-active metabolite DELAQ (IMA-06201) in vivo. SAHRMs have been proposed as therapeutic options for various autoimmune disorders. Clinical trials on LAQ have not reported any significant toxic outcomes and C2 has shown low toxicity in rats; however, their functional resemblance to the highly toxic AHR agonist 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD) raises questions. Here, we characterize the hepatic transcriptomic changes induced by acute (single-dose) and subacute exposure (repeated dosing for 5 days followed by a 5-day recovery period) to C2 in Sprague-Dawley rats. Exposure to C2 leads to activation of the AHR, as shown by altered transcription of Cyp1a1. We identify a heightened response early after exposure that drops off by day 10. Acute exposure to C2 leads to changes to transcription of genes involved in antiviral and antibacterial responses, which highlights the immunomodulator effects of this AHR agonist. Subacute exposure causes an oxidative stress response in the liver, the consequences of which require further study on target tissues such as the CNS and immune system, both of which may be compromised in this patient population.